Obama vs. Romney on 7 innovation policy issues

Both President Barack Obama and Republican challenger Mitt Romney have recognized the importance of technological innovation in economic growth, but they haven’t engaged in a serious conversation about policies to support it.

That’s according to the nonpartisan Information Technology & Innovation Foundation, which has published a new analysis comparing Obama and Romney on technology and innovation polices.

In general, Obama is more willing to make government an active partner with business in pursuing innovation. Romney is more focused on establishing the right framework -- tax and regulatory policies, for example -- that would encourage businesses to innovate on their own.

Which presidential candidate is better for innovation?

“Each candidate brings something to the table that’s useful and different,” said ITIF President Robert Atkinson.

“Ideally what you’d want is a merged candidate” who would pursue all of these policies, he said.

Here’s a look, based on ITIF’s analysis, at how Obama and Romney stack up on 7 key innovation issues:

Federal R&D funding

In 2008, Obama pledged to double federal funding for basic research, focusing on physical and life sciences, over the next 10 years. He’s falling short of that goal, even though he did increase funding for the National Science Foundation.

Romney has called for an immediate 5 percent cut in non-security discretionary spending. Non-defense R&D programs presumably would be subject to this cut -- Romney hasn’t said they’d be exempt.

Taxes

Both Obama and Romney favor revenue-neutral corporate tax reform that would lower the tax rate while eliminating many business tax breaks. They both also favor making the research and development tax credit permanent.

Obama, however, wants to collect more U.S. taxes from multinational corporations. Romney wants to move to a territorial tax system, where income is taxed where it is earned and there would be no additional U.S. taxes if companies move this money back here from foreign countries.

On individual income taxes, Obama would raise the tax rate for households making more than $250,000. Romney proposes a 20 percent across-the-board cut in tax rates, accompanied by the elimination of many tax deductions.

Obama also has proposed raising the capital gains tax rate from 15 percent to 20 percent, while Romney would maintain the 15 percent rate.

Broadband/Internet policy

Both candidates propose making more spectrum available for commercial use, and both oppose efforts by the International Telecommunications Union to take over the pricing on Internet interconnections and technical standards.

Their biggest difference is on net neutrality -- whether the government should prohibit Internet service providers from favoring some web sites over others. Obama favors net neutrality regulations, while exempting wireless networks from most of them. Romney opposes net neutrality rules, instead relying on market forces to ensure an open Internet.

Obama also would rely more on regulations to address issues such as online privacy and cybersecurity. The president also favors a more robust government role in expanding broadband access, while Romney would leave broadband demand creation to local governments and the private sector.

Energy innovation

This is one of the biggest areas of disagreement between the two candidates: Obama is promoting a national energy strategy to transition from fossil fuels to renewable energy sources. That includes government investments in energy innovation, including deployment as well as basic science.

Romney wants to achieve North American energy independence primarily by significantly expanding domestic oil and natural gas production. He would limit government investment in energy innovation to basic research and demonstration projects of new energy technologies.

Manufacturing policy

Obama has proposed investing $1 billion to create a National Network for Manufacturing Innovation and $2.2 billion in advanced manufacturing R&D. Romney is silent on these issues.

Immigration

Obama has called for “fixing the immigration system for America’s 21st century economy,” but he hasn’t gotten as specific as Romney, who has proposed raising the limit on visas for holders of advanced degrees in technological fields, and giving green cards to foreigners who graduate from U.S. universities in these fields.

Trade

Both Obama and Romney support completing the Trans-Pacific Partnership trade agreement, and working to expand exports. Obama, however, places more of an emphasis on putting environmental and labor provisions in trade agreements.

Romney also has promised to be tougher on China when it violates trade agreements, particularly when it comes to currency manipulation.